Managerial Accounting Chapter 3

A list of all of the raw materials needed to manufacture a job.

The labor rate charged to the customer, which includes both cost and profit components.

The primary factor that causes a cost.

A pricing approach in which the company adds a desired level of profit to the product's cost.

A written or electronic document that lists the direct materials, direct labor, and manufacturing overhead costs assigned to each individual job.

A system for assigning costs to products or services that differ in the amount of materials, labor, and overhead required.  Typically used by manufacturers that produce unique, or custom-ordered products in small batches; also used by professional service firms.

Bill from a supplier.

A written or electronic document that identifies the employee, the amount of time spent on a particular job, and the labor cost charged to a job.

A written or electronic document that requests specific materials be transferred from the raw materials inventory storeroom to the production floor.

The amount of manufacturing overhead allocated to jobs is more than the amount of manufacturing overhead costs actually incurred; results in jobs being overcosted.

Storeroom workers remove items from raw materials inventory that are needed by production.

The rate used to allocate manufacturing overhead to individual jobs; calculated before the year begins as follows: total estimated manufacturing overhead costs divided by total estimated amount of allocation base.

A system for assigning costs to a large number of identical units that typically pass through a series of uniform production steps.  Costs are averaged over the units produced such that each unit bears the same unit cost.

A written or electronic document indicating the quantity and types of inventory that will be manufactured during a specified time frame.

A written or electronic document authorizing the purchase of specific raw materials from a specific supplier.

A written or electronic document listing the number and cost of all units used and received, and the balance currently in stock; a separate record is maintained for each type of raw material kept in stock.

A written or electronic document listing the quantity and type of raw materials received in an incoming shipment; the report is typically a duplicate of purchase order without the quantity prelisted on the form.

Products normally kept on hand in order to quickly fill customer orders.

Supporting detail for a general ledger account.

The amount of manufacturing allocated to jobs is less than the amount of manufacturing overhead costs actually incurred; this results in jobs being undercosted.